This blog presents my short-term and intermediate-term outlook on the financial markets and is dedicated to the All Stars of Market Timing - R. N. Elliott, W. D. Gann, Frank Taucher and Chris Cadbury and many others that have influenced my market methodology.

May 2009

May 31, 2009

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

5/31/09 (Commentary for Sunday) The SPX rallied on Friday but a 21-day Fib count from the 5/8 high gives us a short-term reversal high on Friday. The market has been moving sideways here but a Large Divergent Decline in the Option Premium Ratio argues for early weakness on Monday and perhaps into the 6/2 Turning Point Day - but the dollar is close to a sharp rebound. A plunging dollar continues to levitate oil, gold and other commodities - but the dollar is close to a sharp rebound. Gold and silver and the HUI/XAU have advanced in a EW 5-wave pattern from the important 4/17 (Economic Pi Cycle lows) - Major Low timing is due this week after which we expect a sharp rally up.

Gold – Gold and the XAU/HUI are due some Major Low Timing this week - buy the dips.We believe that a mania in gold stocks will be evident by fall as all the "bank reserves" added by panicked governments begins to appear in the M2 monetary statistics.

Stock - The market correction from 5/8 through 5/29 appears to be a triangle but who knows - taking out the 5/20 highs is bullish. A EW 5-wave decline from 5/20 to 5/21 confuses the triangle interpretation.

Silver – Silver finished an EW 5-wave advance from 4/17 - silver is due for Major Low timing this week - looking for confirmation.

Crude Oil – Oil looks due for a pullback but the OIH move to new rally highs on Friday argues for a quick pullback.

Bonds - Bonds are close to finishing an EW zig-zag pattern from late December - Friday's steep rally may have marked a low but the 30-yr yield pattern does not look complete to the upside.

Dollar - The dollar finished a 5-wave move down from 5/20 - looking for a sharp bounce this week.

TURNING POINT DAY:

The next Turning Point Day is 6/02 - this looks like a potential low.

Depression Beater Portfolio: New Updates:

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

Holdings:

1) Long 75 shares of SDS at an average price of 103.2249 on 11/18 - roughly 15% of portfolio. (The SDS price was hit by a cash distribution today that I did not anticipate - $11.46 a share - sorry for the lack of warning here - ETFs like mutual funds have late in the year distributions that need to be avoided if possible if you're in a taxable account)

May 28, 2009

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

5/28/09 (Commentary for Thursday) The SPX turned down after the 5/26 Turning Point but the downside appears to be limited due to the level of bearishness in market polls - a sideways congestion pattern is containing the price action. A Divergent Decline in the Option Premium Ratio today argues for early weakness Friday. Friday is the 21 day Fibonacci daily count from the 5/8 high - we could see an important turn - the SPX should be breaking up early next week. Low bullish sentiment numbers from whispernumber.com (19%) keep us from betting too heavily on the downside here. Gold and the HUI/XAU finished a brief correction earlier this week and are heading higher - a pullback tomorrow should be bought. We could be in a 3rd wave up in the PM sector. The bond market could be in a runaway decline - bought TBT calls on pullbacks today.

Stocks - Should see early weakness tomorrow on the SPX - but a break out to the upside is likely early next week.

Gold – The PM sector is in a wave 3 up - buy dips on pullbacks - this sector could really accelerate up next week. We believe that a mania in gold stocks will be evident by fall as all the "bank reserves" added by panicked governments begins to appear in the M2 monetary statistics.

Dollar - The dollar is rallying correctively here .... but a Federal bailout of California could bring a another selling wave.

TURNING POINT DAY:

The 5/26 Turning Point should reverse the market down for a few days - but a turn up early next week is likely.

Depression Beater Portfolio: New Updates:

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

Holdings:

1) Long 75 shares of SDS at an average price of 103.2249 on 11/18 - roughly 15% of portfolio. (The SDS price was hit by a cash distribution today that I did not anticipate - $11.46 a share - sorry for the lack of warning here - ETFs like mutual funds have late in the year distributions that need to be avoided if possible if you're in a taxable account)

May 27, 2009

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

5/27/09 (Commentary for Wednesday) The SPX turned down after the 5/26 Turning Point but the downside appears to be limited due to the level of bearishness in market polls. Friday is the 21 day Fibonacci daily count from the 5/8 high - we could see a turn back up then. Low bullish sentiment numbers from whispernumber.com (19%) keep us from betting too heavily on the downside here. Gold declined after a Fibonacci 34 calendar days from the 4/17 lows - however, Gann reaction timing argues for a short correction here - 2-3 days. We should be heading higher by Friday or Monday. We could be in a 3rd wave up for the PM sector.

Stocks - The SPX correctively bounced into the Turning Point Day today with a Large Divergent Decline on the OPR - should see weakness early tomorrow.

Gold – The XAU/HUI should see a modest pullback into next week - buy dips. The whispernumber.com bullish percent was 24% last Friday - far from the highs of 45% seen in February. We believe that a mania in gold stocks will be evident by fall as all the "bank reserves" added by panicked governments begins to appear in the M2 monetary statistics.

Dollar - The dollar appears close to an important low - could see a sharp reversal soon .... but a Federal bailout of California could bring a another selling wave.

TURNING POINT DAY:

The 5/26 Turning Point should reverse the market down for a few days - but a turn up early next week is likely.

Depression Beater Portfolio: New Updates:

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

Holdings:

1) Long 75 shares of SDS at an average price of 103.2249 on 11/18 - roughly 15% of portfolio. (The SDS price was hit by a cash distribution today that I did not anticipate - $11.46 a share - sorry for the lack of warning here - ETFs like mutual funds have late in the year distributions that need to be avoided if possible if you're in a taxable account)

May 26, 2009

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

5/26/09 (Commentary for Tuesday) The SPX finished what appears to be an EW a-b-c zig-zag correction from late Thursday into today which is a Turning Point Day. A Large Divergent Decline on the Option Premium Ratio (1.07 to 1.00) argues for a reversal tomorrow - but the low bullish sentiment numbers from whispernumber.com (19%) should keep us from betting too heavily on the downside here. Gold declined today after a Fibonacci 34 calendar days from the 4/17 lows - however, Gann reaction timing argues for a short correction here - 2-3 days. We could be in a 3rd wave up for the PM sector.

Gold – The XAU/HUI should see a modest pullback into next week - buy dips. The whispernumber.com bullish percent was 24% last Friday - far from the highs of 45% seen in February. We believe that a mania in gold stocks will be evident by fall as all the "bank reserves" added by panicked governments begins to appear in the M2 monetary statistics.

Stock - The SPX correctively bounced into the Turning Point Day today with a Large Divergent Decline on the OPR - should see weakness early tomorrow.

Silver – Silver pulled back correctively - a 2-3 day decline into next week should lead to a reversal up.

Crude Oil – Oil made new rally highs today - should see a pullback.

Bonds - Bonds continued to breakdown but looking for big rally to start soon - sold TBT calls.

Dollar - The dollar appears close to an important low - could see a sharp reversal soon.

TURNING POINT DAY:

The Turning Point Day today could reverse the market down for a few days.

Depression Beater Portfolio: New Updates:

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

Holdings:

1) Long 75 shares of SDS at an average price of 103.2249 on 11/18 - roughly 15% of portfolio. (The SDS price was hit by a cash distribution today that I did not anticipate - $11.46 a share - sorry for the lack of warning here - ETFs like mutual funds have late in the year distributions that need to be avoided if possible if you're in a taxable account)

May 25, 2009

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

5/25/09 (Commentary for Monday) The SPX price pattern WAS NOT AN IMPULSIVE RALLY and this leaves the market open for more decline this week. However, the CORRECTIVE PATTERN on Friday appears to need a C-wave up on Tuesday and the OPR/MO buy signal on Friday argues for a strong rally tomorrow. Friday gave us a Large Divergent Rally on the Option Premium Ratio and a Big Move signal on the McClellan Oscillator (+1.69) - together this gives us an OPR/MO buy signal. However, 5/26 is also a Turning Point Day - so we would sell our short-term call positions by the close. A plunging dollar continues to levitate oil, gold and other commodities. Gold and silver and the HUI/XAU have advanced in a EW 5-wave pattern from the important 4/17 (Economic Pi Cycle lows) - we have also traveled a Fibonacci 34 days from those lows - some kind of pullback is likely early this week.

Gold – Gold and the XAU/HUI has done 5-waves up from 4/17 - and has traveled a Fibonacci 34 days from the lows - should see a pullback early this week into the first week of June - but the weak dollar keeps propelling this market higher.We believe that a mania in gold stocks will be evident by fall as all the "bank reserves" added by panicked governments begins to appear in the M2 monetary statistics.

Stock - The market correction from 5/8 through 5/21 was shallow but the corrective bounce on Friday implies more downside after a rally on Tuesday. Take profits on calls tomorrow and prepare for more downside.

Crude Oil – Oil's advance is being fueled by a weak dollar - a short-term peak was registered on the 5/20 Turning Point day - looking for another small leg down.

Bonds - Bonds are close to finishing an EW zig-zag pattern from late December - 116 on the June bonds should be watched for a reversal up - especially if the broad market has more downside after Tuesday.

Dollar - If the dollar finishes a 5-wave decline from 5/20 Tuesday, look to sell all June calls on stocks.

TURNING POINT DAY:

The next Turning Point Day is 5/26 - this looks like a potential rally high and a corrective high from Friday.

Depression Beater Portfolio: New Updates:

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

Holdings:

1) Long 75 shares of SDS at an average price of 103.2249 on 11/18 - roughly 15% of portfolio. (The SDS price was hit by a cash distribution today that I did not anticipate - $11.46 a share - sorry for the lack of warning here - ETFs like mutual funds have late in the year distributions that need to be avoided if possible if you're in a taxable account)

May 21, 2009

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

5/21/09 (Commentary for Thursday) The SPX finished what appears to be an EW a-b-c flat correction from the Turning Point Day on 5/8 until today 5/21 ( a Fib 13 days between). We may have finished a Wave 2 of C up and are about to blast off in a Wave 3 of C tomorrow. For confirmation of this count, we need to see a large IMPULSIVE rally that takes out the 5/8 highs by Tuesday 5/26. If we get a CORRECTIVE 3-wave bounce tomorrow instead, very bearish wave counts come into play and will we need to exit our June call positions. A plunging dollar continues to levitate oil, gold and other commodities. The whispernumber.com bullish percentage for stocks dropped from 36% to 25% last Friday - a multi-week low - this is potentially very bullish for the SPX in the near term. Gold continues to power up - the HUI/XAU has done 5-waves up from its 4/21 low - looking for a pullback into early June - not trying to short.

Gold – The XAU/HUI has down 5-waves up from 4/21 - should see a pullback soon into the first week of June - the weak dollar keeps propelling this market higher.We believe that a mania in gold stocks will be evident by fall as all the "bank reserves" added by panicked governments begins to appear in the M2 monetary statistics.

Stock - The market appeared to finish a corrective sideways decline from 5/8 through today 5/1 - could see the start of the next leg up tomorrow morning. If all we get is a 3-wave corrective bounce tomorrow, look for a deeper decline.

The next Turning Point Day is 5/26 - the start of an IMPULSIVE wave up tomorrow would argue for a high on Tuesday.

Depression Beater Portfolio: New Updates:

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

Holdings:

1) Long 75 shares of SDS at an average price of 103.2249 on 11/18 - roughly 15% of portfolio. (The SDS price was hit by a cash distribution today that I did not anticipate - $11.46 a share - sorry for the lack of warning here - ETFs like mutual funds have late in the year distributions that need to be avoided if possible if you're in a taxable account)

May 20, 2009

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

5/20/09 (Commentary for Wednesday) The SPX declined on today's Turning point Day but the pattern looked corrective. The volume was light and the internals remained positive giving the impression that the pullback may be a fake out - the bears didn't exactly cover themselves with glory on the sell off today. A plunging dollar continues to levitate oil, gold and other commoditites. The whispernumber.com bullish percentage dropped from 36% to 25% on Friday - a multi-week low - this is potentially very bullish for the SPX in the near term. Gold consolidated after today's rally - looking for more rally tomorrow.

Gold – Gold resisted a pullback on today's Starkey 1-Day Reversal Timing - a sign of strength. The consolidation pattern argues for another push up tomorrow. We believe that a mania in gold stocks will be evident by fall as all the "bank reserves" added by panicked governments begins to appear in the M2 monetary statistics.

Stock - The SPX pulled back today but the pattern looked corrective - low volume and positive breadth shows the lackluster effort by the bears.

Today, 5/20, was a Turning Point Day - a move down started - should at least test last week's low on the SPX - if not, a 3rd wave up from the March low is probably underway.

Depression Beater Portfolio: New Updates:

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

Holdings:

1) Long 75 shares of SDS at an average price of 103.2249 on 11/18 - roughly 15% of portfolio. (The SDS price was hit by a cash distribution today that I did not anticipate - $11.46 a share - sorry for the lack of warning here - ETFs like mutual funds have late in the year distributions that need to be avoided if possible if you're in a taxable account)

May 19, 2009

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

5/19/09 (Commentary for Tuesday) The SPX is set to decline tomorrow on the Turning Point Day - the small change in the McClellan Oscillator argues for a big move down. A few days of decline could set the pattern for a bullish inverse head and shoulders pattern on the daily chart - the next few days should set us up for the next rally leg up. The whispernumber.com bullish percentage dropped from 36% to 25% on Friday - a multi-week low - this is potentially very bullish for the SPX. Gold bounced today but a reversal down is due tomorrow.

Gold – Tomorrow is a 1-Day Reversal window from Starkey - looking for a reversal down. This is a key peak timing week for the PM sector - looking for a low by the first week of June. We believe that a mania in gold stocks will be evident by fall as all the "bank reserves" added by panicked governments begins to appear in the M2 monetary statistics.

Stock - The SPX is set for a decline on tomorrow's Turning Point Day - the McClellan Oscillator argues for a big down day.

Silver – Silver is peaking in this turning point window - pullbacks into early June should be bought.

Tomorrow, 5/20 is the next Turning Point Day - a move down is likely - should at least test last week's low on the SPX.

Depression Beater Portfolio: New Updates:

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

Holdings:

1) Long 75 shares of SDS at an average price of 103.2249 on 11/18 - roughly 15% of portfolio. (The SDS price was hit by a cash distribution today that I did not anticipate - $11.46 a share - sorry for the lack of warning here - ETFs like mutual funds have late in the year distributions that need to be avoided if possible if you're in a taxable account)

May 18, 2009

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

5/18/09 (Commentary for Monday) We blew the market call today. We forgot about the Major Turning Point Day that fell on Saturday and the high TRIN-5 reading of 8.36 that was posted on Friday - these served to rally the market today. Today's internals were stellar but the volume was weak which leads the focus to tomorrow - another rally day will turn us short-term bullish and we will be dumping our puts. Today was the last day of the Merriman 5/15 - 5/18 Turn Window and we had a rally in the Option Premium Ratio (.93 to 1.01) which argues for a decline tomorrow. The whispernumber.com bullish percentage dropped from 36% to 25% on Friday - a multiweek low - this is potentially very bullish for the SPX. Gold declined hard in the Starkey Reversal Window - should decline into the first week of June. .

Gold – Gold reversed down today and should decline into early June. The whispernumber.com bullish percent rose from 9.6% to 17.3% last Friday - arguing for a short-term top and more basing action. We believe that a mania in gold stocks will be evident by fall as all the "bank reserves" added by panicked governments begins to appear in the M2 monetary statistics.

Stock - The SPX is in the time window for an important turn - a 3-wave decline tomorrow will turn us short-term bullish .

Silver – Silver appears to be declining impulsively - looking for low in early June.

Crude Oil – Crude oil is due an important turn in this time period - tomorrow's price action key.

Bonds - Bonds declined correctively- should see a turn up tomorrow. Sold Jun 51 TBT calls.

The next Major Turning Point Window is 5/15-18 and it could bring an important reversal to many markets.

Depression Beater Portfolio: New Updates:

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

Holdings:

1) Long 75 shares of SDS at an average price of 103.2249 on 11/18 - roughly 15% of portfolio. (The SDS price was hit by a cash distribution today that I did not anticipate - $11.46 a share - sorry for the lack of warning here - ETFs like mutual funds have late in the year distributions that need to be avoided if possible if you're in a taxable account)

May 17, 2009

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

5/17/09(Commentary for Sunday) The SPX peaked near the Major Turning Point Day on 5/10 and declined into Wednesday. After a corrective looking bounce into mid-day Friday the market turned down once again near the Major Turning Point Day on 5/16 - we should due at least one more big leg down into 5/20, the next Turning Point day - so we are expecting a move down on Monday. The Option Premium Ratio gave us a (.86,1.02,.97) pattern the past three trading days - the spike up into 1.02 generated a sell signal that averages about 3-4 %. However, in the intermediate term, we feel that the market should make one move powerful move up until the retail sentiment becomes overwhelmingly bullish. Gold appears to be completing a wedgy advance and the HUI/XAU peaked on Wednesday - gold should reverse down this week according to Starkey peak timing and bottom in the first week of June.

Gold - The low bullish sentiment in the whispernumber.com (<10%) survey the past three weeks argues for a brief pullback in gold that should be followed by a large rally starting in early June.

Stocks - The SPX should decline hard on Monday - the Turning Point Day on 5/20 should be watched for a reversal.

Silver - Silver appears to have peaked - should decline into the first week of June.

Crude Oil -Crude oil appears to have peaked on Wednesday - should do another leg down into mid-week.

Bonds- Bonds may have started an EW a-b-c decline on Friday. Holding TBT Jun calls.

Dollar -The dollar has been in a downtrend since the 4/21 Pi Cycle date – we may see a short-term bounce on Monday.

TURNING POINT DAYS:

The Major Turning Point Day on 5/16 turned the market down mid-day Friday - a decline into the 5/20 Turning Point Day is likely.

Depression Beater Portfolio: New Updates:

(This portfolio is just a sample of my own portfolio - no recommendation to others is implied or intended)

Holdings:

1) Long 75 shares of SDS at an average price of 103.2249 on 11/18 - roughly 15% of portfolio. (The SDS price was hit by a cash distribution today that I did not anticipate - $11.46 a share - sorry for the lack of warning here - ETFs like mutual funds have late in the year distributions that need to be avoided if possible if you're in a taxable account)